How The Pandemic Has Changed Our Relationship With Housing
posted in Mortgage News
Predictions made by experts within the housing and mortgage market, suggest that housing activity in Canada will continue to be strong throughout 2021 and even into the following year, and it’s estimated that 701,000 homes will be sold through Canadian MLS systems this year. It’s also predicted that the national average price of a home will grow by as much as 16.5% annually, hitting a high of $665,000.
The Canadian Real Estate Association previously forecast record sales numbers for 2021, but in fact, activity has been far stronger than anticipated, representing a large upward revision as a result of the incredible sales growth in recent months. Further predictions of a reopening of those hard-to-distance sectors of the economy that have struggled the most with the health pandemic, and a re-acceleration of immigration, have been triggered by the prospect of mass inoculations, which have already begun in earnest.
What has been the overall effect of COVID-19 on the Canadian real estate market so far?
While some of the effects on the Canadian real estate market have yet to be felt in full, weakening high-rise condo prices and increasing low-rise prices have made their impact felt, and there has been an overall decline in rental income and general property prices.
Perhaps one of the most significant ways in which the pandemic has affected the Canadian real estate market, is in the relationship that many people have with housing. For more than a year now, home has been everything for many global citizens, and the enforced periods of lockdown and quarantine have resulted in an increased desire to have a place to call their own. People are typically wanting larger, independent properties with bigger yards, and are less drawn towards types of housing with communal areas and shared facilities.
The remote working revolution has also had a significant impact upon homeowners and buyers, and calculating journey times and proximity to work has become one of the biggest factors in choosing where to live this year; this trend is set to continue as many companies enforce remote working, or give their employees the option to work from home instead of travelling to the office.
What Canadian home buyers are doing now and the problems their behavior may cause?
First-time home buying activity has seen a surge as many Canadians seek to find sanctuaries of their own amid the chaos of the pandemic, and existing homeowners are opting to move to more desirable homes. This ever-accelerating activity is coupled with concerns over supply and demand, and while inventories are down across the country, demand is continuing to set incredible monthly records.
This particular dynamic fueled by COVID-19 is seeing rising prices everywhere, which in turn, may pull even more demand from the future as Canadian homebuyers experience an increased urgency to lock in existing prices at exceptionally low mortgage rates.
Who knows quite what the future holds for the Canadian housing market, but the desire to live in an independent home, coupled with trends such as remote working, are set to change the face of housing for the foreseeable future.